Top Trade Ideas for the Week of January 30, 2017: The Best

After reviewing over 1,000 charts, I have found some good setups for the week. This week’s list contains the first five below to get you started early. These were selected and should be viewed in the context of the broad Market Macro picture reviewed Friday which heading into February saw the Equity markets continuing to look strong, especially on the intermediate charts.

Elsewhere look for Gold to continue lower while Crude Oil churns over support. The US Dollar Index continues lower but may be bottoming while US Treasuries are biased lower. The Shanghai Composite is resuming its drift higher, but will be closed until Friday while Emerging Markets work higher.

Volatility looks to remain at abnormally low levels keeping the bias higher for the equity index ETF’s SPY, IWM and QQQ. Their charts show real strength continuing in the intermediate term. Shorter term the QQQ has been the leader but is getting a bit overheated, while the SPY and IWM may be ready to start higher out of consolidation. Use this information as you prepare for the coming week and trad’em well.

bluebird bio, Ticker: $BLUE

bluebird bio, $BLUE, broke out of a consolidation zone in September. It moved higher but failed soon after, falling back to the bottom of the zone. A rise from there met resistance and consolidated before a second move higher. But again it failed and pulled back, this time to a higher low though at the 50 day SMA. A move higher pulled back to the 50 day SMA again, another higher low, and reversed. Friday it broke above resistance to a higher high. The Bollinger Bands® are turning up and the RSI is rising in the bullish zone with a MACD crossed up and rising. All support more upside price action. There is resistance at 74.50 and 79 before 82 and 94.50 then 100. That would only be a 38.2% retracement of the move lower from mid 2015. Support lower comes at 69.50 and 64. Short interest is high at 20.1%. Enter long now (over 69.5) with a stop at 66. As it moves over 73 move the stop to a $5 trailing stop and take off 1/3 on a stall at 100 or higher. As an options trade consider the February 70 Calls (offered at $4.60 late Friday) and trade them like the stock trade (using the stock price as a trigger, stop and target).

Domino’s Pizza, Ticker: $DPZ

Domino’s Pizza, $DPZ, has been trending higher since May 2016. It slowed the pace last fall and then jumped higher. That November high has since acted as resistance, with support tightening against it, forming an ascending triangle. A break of that triangle to the upside would give a trigger to 194. Friday made for the 6th touch of the triangle bounds, a good spot for a break. There is no resistance over 172 and support lower comes at 170 and 164. Short interest is moderate at 4.6%. Enter long on a move over 172.50 with a stop at 169. As it moves over 174 move the stop to break even and then to a $5 trailing stop over 177.50. Take off 1/3 on a stall at 194 or higher. As an options trade consider the February 170 Calls ($4.60) and trade them like the stock trade. Sell the February 165 Puts (70 cents) to add leverage.

Exact Sciences, Ticker: $EXAS

Exact Sciences, $EXAS, had a quick run higher from a low in May to a Shooting Star candle at the high in August. That confirmed lower the next day and started a descent in a channel for the 4 and a half months. A gap higher in January broke that channel after it had retraced 50% of the move. That move failed and it fell back to retest the break out level. It got bought there and has reversed back up. The RSI is moving back higher as well along with the MACD stalling in its pullback. There is resistance at 19.30 and 20.25 followed by 21.65 and 22.85. An AB=CD pattern would give a target to 30.50. Support lower comes at 17 and 15.80. Short interest is high at 29.1%. Enter long now (over 17) with a stop at 17. As it moves over 19.25 move the stop to break even and then to a $2 trailing stop over 20.25. Take off 1/3 on a stall at 30 or higher. As an options trade consider the February 18 Calls ($1.15) and trade them like the stock trade.

Freeport-McMoRan, Ticker: $FCX

Freeport-McMoRan, $FCX, broke above 14, a key level since September 2105, in November. It failed and pulled back under, but found support at a higher low. The reversal higher made a higher high last week before a small pullback. That closed a gap and reversed, giving you a low to trade against. The bigger view shows a target to 20.30 on an AB=CD pattern. The RSI is bullish and rising with the MACD rising. There is resistance at 16.40 and 17 then 19.30 and 20.70 before 24. Support lower comes at 15.75 and 15. Short interest is moderate at 5.2%. Enter long on a move over 16.50 with a stop at 15.60. As it moves over 17 move the stop to break even and then to a 75 cent trailing stop over 17.25. Take off 1/3 on a stall at 20.30 or higher. As an options trade consider the February 16.50 Calls ($0.68) and trade them like the stock trade.

LendingTree, Ticker: $TREE

LendingTree, $TREE, pulled back into a March low in 2016. Since then it has made a couple of higher lows and higher highs, before settling into consolidation since mid-November. Friday it broke that consolidation to the upside with a strong Marubozu candle. The August high mow is the last resistance before a thinly traded range to the prior high. The RSI is bullish and rising while the MACD is turning up. There is resistance at 112.25 and then 116.55 before 125.50 and 127.75. Support lower comes at 108.70 and 104.30. Short interest is high at 40.3%. Enter long now (over 108.70) with a stop at 105. As it moves over 112 move the stop to break even and then to a $5 trailing stop over 115. Take off 1/3 on a stall at 127.70 or higher. As an options trade consider the February 110 Calls ($4.90) and trade them like the stock trade. Sell the February 120 Calls (90 cents) and or the February 100 Puts (95 cents) to lower the cost and add leverage.

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